Implementation of the blanket reverse-charge regime from 1 July 2020 to 30 June 2022

The European Commission approved using the blanket reverse-charge regime by the Czech Republic for a limited period which starts from 1 July 2020 and lasts until 30 June 2022. All taxable supplies regarding goods and services where a single transaction is over CZK 450,000 (EUR 17,500) will be subject to the regime.

The reverse-charge regime (which signifies a transfer of the tax duty) means that, between VAT payers, the obligation to report and pay output VAT for the realised taxable supply with its place of supply in the Czech Republic is transferred from the provider of the supply (the supplier) to the receiver of the supply (the customer). The system will not apply if the customer is not a VAT payer; in such a case, the VAT is paid by the provider. Currently, the Czech Republic uses the system everywhere where the current EU law allows it.